Employee Benefit Trust Minutes - 05/15/2007 ,t
CITY OF WICHITA FALLS
EMPLOYEE BENEFITS TRUST BOARD MEETING
May 15,2007
Present: Bill Sullivan, Chair
Darron Leiker, City Manager
Jim Dockery, Finance Director
Gail Garmon, Employee Benefits Coordinator
The meeting was called to order at 4:00 p.m.
Agenda Items:
Approval of Minutes
Jim Dockery made a motion to accept the minutes of the March 5 meeting. Darron
Leiker seconded the motion. Motion carried.
Financial Statement
Jim Dockery stated that claims paid to date total $3,610,307. The projected surplus for
the year should be between$412,000. and $776, 212. depending on total claims paid over
the next five to six months.
Discussion of Actuarial Study
Jim Dockery presented a report showing the results of the actuarial study by Gabriel,
Roeder, Smith& Co. The report showed the retiree unfunded(our current pay as you go
system)accrued liability to be $85,601,116 and the pre-funded liability to be
$54,933,864. the report further stated that the unfunded liability normal cost(one year
cost for all retirees)to be $2,183,276 and $975, 699. under the pre-funded option. The
annual required contribution to the plan under the unfunded option is $7,477,103 or
$9,838. per active member and$5,594,744 under the pre-funded, or$7,362. per active
member. The reported showed that while the retiree health care costs were in excess of
2.5 million dollars,premiums paid by retirees only totaled$655,000. which means the
City paid the remaining two million.
In summary, the actuarial report concluded that the current benefit package for retirees is
a fairly"rich"one; that the ratio of active employees to retirees is approximately 3 to 1;
the plans with older age participants cost more; retirees are paying 25% vs. the City at
75%; and, having no service eligibility requirement causes significant costs.
Consider Additional Services from Actuary
Jim Dockery reported that the actuary can do several scenarios aimed at reducing the
liability. He presented material outlining several of their suggestions. After some
discussion,the Board authorized Jim to request additional services from the actuary to
prepare three scenarios for Post 65 Participants and six scenarios for Pre 65 Participants
(future retirees). The Board will later meet with representatives from the actuarial firm to
go over the findings before presenting it to the Council.
Jim made a motion to request the additional services at a cost of$750.00 per scenario.
Bill Sullivan seconded the motion. Motion carried.
Other Business
Jim Dockery reported that he had received an accounting of the 2006 Flex Spending
Account program from Alt Benefits. Of the original $394,000 in pledged contributions,
$374,000 was actually collected. With actual money paid out and what was left by those
who did not use all of their allotted benefit, the City lost only$192.00.
The meeting was adjourned at 5:40 p.m.
Respectfully submitted,
J-C--
Gail Garmon
Employee Benefits Coordinator